The personal is always the political, and vice versa. I nearly lost one of my oldest and dearest friends in 2004 after she forwarded me an email containing an incendiary anti-George W. Bush op-ed by the leftist novelist E.L. Doctorow. Among other charges in the op-ed, which made Bush look about as caring as King George III in the run-up to the Revolutionary War, Doctorow claimed Bush didn't care about the "forty percent" of Americans "who cannot afford health insurance." "Do you really believe this?" I emailed back, pointing out that Doctorow had gotten his numbers jumbled. It was not 40% but 40 million Americans — more like 15% — who lacked health insurance for various reasons back then. It took six years for my friend and me to mend our sundered relationship.

I was interested in this because my undergraduate degree is from GW. It disappoints me that the original source doesn't explain how one knows that these are student cars--why couldn't they be faculty?--and what kind of students they are--Maybe med students? Executive MBAs? But interesting nonetheless.

The five cars collected above include a Mercedes SLS AMG ($183,000), a McLaren SLR McLaren 722 S Roadster ($548,000), a Ferrari 575 Superamerica ($320,000), an Audi R8 V10 Spyder ($165,000) and a BMW X5 M in the background ($87,250). And all that's assuming the buyers didn't pay a lot of money for extras.

The problem here is that prices can’t stay wrong indefinitely. There is a good reason why classical economists are always so focused on allowing markets to find the correct price level. In that way, markets send the proper signals to potential investors on where money should or should not go. If those price indicators are skewed, so is the direction of resources. The Asian model, by playing around with prices, eventually creates tremendous distortions, in which money is wasted and excess capacity is generated. Subsidized companies don’t have to generate returns in the same way as unsubsidized firms, and that leads them to make bad investment decisions to build factories and buildings that are unnecessary and unprofitable. As a result, loans go bad and banking sectors buckle. That’s exactly what happened in both Japan and Korea. Though their crises were tipped off in very different ways — the bursting of an asset bubble in Japan, an external shock in Korea — the reason both countries collapsed was the same: weak banks, indebted companies, silly investments.

February 27, 2012

Stated briefly, I will simply try to clarify what the debate over climate change is really about. It most certainly is not about whether climate is changing: it always is. It is not about whether CO2is increasing: it clearly is. It is not about whether the increase in CO2, by itself, will lead to some warming: it should. The debate is simply over the matter of how much warming the increase in CO2 can lead to, and the connection of such warming to the innumerable claimed catastrophes. The evidence is that the increase in CO2 will lead to very little warming, and that the connection of this minimal warming (or even significant warming) to the purported catastrophes is also minimal. The arguments on which the catastrophic claims are made are extremely weak – and commonly acknowledged as such. They are sometimes overtly dishonest.